Changes over time for: Pensions Act 2011

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E+W+S+N.I.

Pensions Act 2011

2011 CHAPTER 19

An Act to make provision relating to pensions; and for connected purposes.

[3rd November 2011]

Be it enacted by the Queen's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Part 1E+W+S+N.I.State pension

1Equalisation of and increase in pensionable age for men and womenE+W+S+N.I.

(1)In Schedule 4 to the Pensions Act 1995 (equalisation of and increase in pensionable age for men and women) paragraph 1 is amended as follows.

(4)The repeal made by subsection (3) does not affect the application of section 151(5) of that Act in relation to a person who became entitled to a Category A or Category B retirement pension before the day on which subsection (3) comes into force.

(8)The enactments amended by Schedule 2 have effect in relation to such a case as if the repeals and amendments made by that Schedule (apart from the amendments made by paragraph 3(7) and (8)) had not been made.

(9)In subsection (7) “W” and “S” have the same meaning as in paragraph 5 of Schedule 5 to the Social Security Contributions and Benefits Act 1992.

(10)In this section a reference to becoming entitled to a pension before a day includes a reference to becoming entitled on or after that day to the payment of a pension in respect of a period before that day.

Prospective

3Consolidation of additional pensionE+W+S+N.I.

Schedule 3 (consolidation of additional pension) has effect.

Part 2E+W+S+N.I.Automatic enrolment

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I1Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

(c)is not an active member of a qualifying scheme because there has been a period beginning at any time after the jobholder's automatic enrolment date during which the requirements of section 1(1)(a) or (c) were not met (so that the person was not a jobholder for that period).

(1B)This section also applies to a jobholder who has ceased to be an active member of a qualifying scheme because of something other than an action or omission by the jobholder.”

(3)For subsection (4) of that section substitute—

“(4)Regulations may provide for subsection (2) not to apply in relation to a jobholder who in prescribed circumstances—

(a)has ceased to be an active member of a qualifying scheme because of any action or omission by the jobholder, or by the employer at the jobholder's request, or

(b)is treated as not being an active member of a qualifying scheme because the jobholder has given notice under section 8.”

(4)In subsection (8) of that section omit “, after the automatic enrolment date,”.

(i)the day on which the jobholder became an active member of the scheme to which the notice relates, or

(ii)a day within the prescribed period (if a period is prescribed)”.

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I2Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

(c)to whom earnings of more than £7,475 are payable by the employer in the relevant pay reference period (see section 15).”

(4)After subsection (7) of that section insert—

“(7A)In this section “earnings” has the meaning given in section 13(3).

(7B)In the case of a pay reference period of less or more than 12 months, subsection (1) applies as if the amount in paragraph (c) were proportionately less or more.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I3Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

6Postponement or disapplication of automatic enrolmentE+W+S+N.I.

(1)In section 3 of the 2008 Act (automatic enrolment) at the end of subsection (7) insert—

“This is subject to section 4.”

(2)For section 4 of the 2008 Act substitute—

“4Postponement or disapplication of automatic enrolment

(1)Where—

(a)an employer (E) gives to a person employed by E on E's staging date (“the worker”) notice that E intends to defer automatic enrolment for the worker until a date specified in the notice (“the deferral date”), and

(b)any prescribed requirements in relation to the notice are met,

the worker's automatic enrolment date is the deferral date if on that date section 3 applies to the worker as a jobholder of E; if not, subsection (4) applies.

(2)Where—

(a)a person (“the worker”) begins to be employed by an employer (E) after E's staging date,

(b)E gives the worker notice that E intends to defer automatic enrolment until a date specified in the notice (“the deferral date”), and

(c)any prescribed requirements in relation to the notice are met,

the worker's automatic enrolment date is the deferral date if on that date section 3 applies to the worker as a jobholder of E; if not, subsection (4) applies.

(b)E gives the worker notice that E intends to defer automatic enrolment until a date specified in the notice (“the deferral date”), and

(c)any prescribed requirements in relation to the notice are met,

the worker's automatic enrolment date is the deferral date if on that date section 3 applies to the worker as a jobholder of E; if not, subsection (4) applies.

(4)Where this subsection applies, section 3(2) does not apply in relation to any employment of the worker by E in the period beginning with the starting day and ending with the deferral date.

(5)A notice under this section may be given on or before the starting day or within a prescribed period after that day.

(6)The deferral date may be any date in the period of three months after the starting day.

(7)An employer who gives a worker a notice under subsection (1) or (2) may not give the worker a notice under subsection (3) in relation to any occasion on or before the deferral date specified in the notice on which the worker becomes a jobholder to whom section 3 applies.

(8)In this section—

“staging date”, in relation to an employer of a particular description, means the date prescribed under section 12 in relation to employers of that description;

“starting day” means—

(a)

E's staging date, in the case of a notice under subsection (1);

(b)

the day on which the worker begins to be employed by E, in the case of a notice under subsection (2);

(c)

the day on which the worker becomes a jobholder to whom section 3 applies, in the case of a notice under subsection (3).”

(5)In section 7 of the 2008 Act (jobholder's right to opt in) omit paragraph (b) of subsection (2) and the “or” before it.

(6)In section 30 of the 2008 Act (transitional period for defined benefits and hybrid schemes) in subsection (7)—

(a)for “applies, section” substitute “applies—

(a)section”;

(b)for “day on which” substitute “ day with effect from which ”;

(c)at the end insert—

“(b)section 4 applies as if—

(i)the reference in subsection (1) to the employer's staging date were a reference to the employer's first enrolment date;

(ii)in that subsection, for “the workers's automatic enrolment date is the deferral date” there were substituted “ the day with effect from which arrangements fall to be made by virtue of section 30 in respect of the jobholder is changed to the deferral date ”;

(iii)in subsections (4) to (6), references to the starting day were references to the day with effect from which arrangements would by virtue of this section fall to be made in respect of the jobholder.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I4Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

7Timing of automatic re-enrolmentE+W+S+N.I.

In section 6 of the 2008 Act (timing of automatic re-enrolment) in subsection (1)(b) for “three years” substitute “ 2 years and 9 months ”.

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I5Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

8Review of earnings trigger and qualifying earnings bandE+W+S+N.I.

“14Review of earnings trigger and qualifying earnings band

(1)The Secretary of State must in each tax year consider whether any of the amounts in sections 3(1)(c), 5(1)(c) and 13(1)(a) and (b) should be increased or decreased.

(2)If the Secretary of State considers that any of those amounts should be increased or decreased, the Secretary of State may make an order substituting in the provisions in question the amounts that the Secretary of State thinks appropriate.

(3)For the purposes of subsection (1) the Secretary of State may take into account any of the factors specified in subsection (4) (as well as any others that the Secretary of State thinks relevant).

(4)The factors are—

(a)the amounts for the time being specified in Chapter 2 of Part 3 (personal allowances) of the Income Tax Act 2007;

(b)the amounts for the time being specified in regulations under section 5 of the Social Security Contributions and Benefits Act 1992 (earnings limits and thresholds for Class 1 national insurance contributions);

(c)the amount for the time being specified in section 44(4) of that Act (rate of basic state pension);

(d)the general level of prices in Great Britain, and the general level of earnings there, estimated in such manner as the Secretary of State thinks fit.”

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I6Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

“15APower to specify rounded figures

(1)The Secretary of State may by order specify rounded figures for the purposes of section 3(6B), 5(7B) or 13(2) in the case of pay reference periods of any length specified in the order.

(2)A rounded figure so specified applies in place of the amount that would otherwise apply (“the exact amount”).

(3)The Secretary of State must decide in relation to any particular amount whether to specify—

(a)a figure that is a whole number of pounds, or

(b)a figure that is divisible by 10 pence, or

(c)a figure that includes a whole number of pennies.

(4)It is for the Secretary of State to decide whether to round any particular amount up or down.

Accordingly, a figure specified under this section may be the figure within paragraph (a) or (b) or (c) of subsection (3) that is closest to the exact amount or the one that is next closest to it (or, if two figures are joint closest, it may be either of those).”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I7Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

10Qualifying schemes: administration chargesE+W+S+N.I.

(1)Section 16 of the 2008 Act (qualifying schemes) is amended as follows.

(2)In subsection (3) for paragraph (a) substitute—

“(a)administration charges due from J while J is an active member exceed a prescribed amount,

(aa)administration charges due from former active members while J is an active member exceed a prescribed amount,

(ab)while J is an active member, the scheme contains provision under which administration charges that will be due from J when J is no longer an active member will exceed a prescribed amount, or will do so in particular circumstances,”.

(3)After that subsection insert—

“(4)For the purposes of subsection (3) administration charges are due from a person to the extent that—

(a)any payments made to the scheme by, or on behalf or in respect of, the person,

(b)any income or capital gain arising from the investment of such payments, or

(c)the value of the person's rights under the scheme,

may be used to defray the administrative expenses of the scheme, to pay commission or in any other way that does not result in the provision of pension benefits for or in respect of members.

(5)In subsection (3)(aa) “former active member” means a person who at some time after the automatic enrolment date was both a jobholder and an active member but is no longer an active member.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I8Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

11Test scheme standard for schemes that produce sum of money for provision of benefitsE+W+S+N.I.

“(8)In the case of a scheme under which a sum of money is made available for the provision of benefits to a relevant member, references in this section to pensions are to be read as references to such sums.”

(a)provide for a member to be entitled to a pension commencing at the appropriate age and continuing for life, or

(b)provide for a sum of money to be made available for the provision of benefits to a member commencing at the appropriate age and continuing for life.

(3)The appropriate age is 65 or any higher age prescribed.

(4)In the case of a scheme that provides entitlement to a pension as mentioned in subsection (2)(a), the annual rate of the pension at the appropriate age must be—

(a)1/120th of average qualifying earnings in the last three tax years preceding the end of pensionable service,

multiplied by

(b)the number of years of pensionable service, up to a maximum of 40.

(5)Section 13(1) (qualifying earnings) applies for the purposes of subsection (4) as if the reference to a pay reference period were a reference to a tax year.

(6)In the case of a scheme that provides for a sum of money to be made available as mentioned in subsection (2)(b), regulations must prescribe requirements relating to that sum.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I9Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

12Certification that alternative to quality requirement is satisfiedE+W+S+N.I.

(1)Section 28 of the 2008 Act (sections 20, 24 and 26: certification that quality requirement is satisfied) is amended as follows.

“employer contributions”, in relation to an active member of a scheme, means the amount of contributions that have to be paid under the scheme in respect of the member by the employer;

“total contributions”, in relation to an active member of a scheme, means the total amount of contributions that have to be paid under the scheme in respect of the member by the employer and by the member.

(2C)The Secretary of State—

(a)must apply the test in subsection (2A) when regulations under subsection (2)(b) are first made, and

(b)must carry out subsequent reviews of whether the test continues to be satisfied.

A review under paragraph (b) must be carried out during 2017, and after that each review must be completed no more than three years after the completion of the previous one.”

(8)In section 32 of the 2008 Act (power to modify by resolution) in subsection (1)(b) for the words after “the scheme” substitute “to satisfy—

(i)the requirements contained in section 20(1),

(ii)those requirements as modified under section 24(1)(a), or

(iii)a requirement prescribed under section 28(2)(b).”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I10Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

13Certification for non-UK schemesE+W+S+N.I.

(1)Section 28 of the 2008 Act is amended as follows.

(2)After subsection (3) insert—

“(3A)This section also applies to—

(a)a money purchase scheme that is an occupational pension scheme within section 18(b);

(b)a personal pension scheme of a prescribed description for which provision is made under section 27;

(c)a hybrid scheme that is an occupational pension scheme within section 18(b), to the extent prescribed.”

(3)In subsection (4) at the end insert—

“(d)for a scheme within subsection (3A), means a prescribed requirement.”

(b)any agreement of the same or a similar kind that is required, in the case of a scheme within subsection (3A)(b), by regulations under section 27.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I11Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

14Transitional period for defined benefits and hybrid schemes to be optionalE+W+S+N.I.

(1)Section 30 of the 2008 Act (transitional period for defined benefits and hybrid schemes) is amended as follows.

(2)In subsection (3) for “Where this subsection applies” substitute “ If by the end of the prescribed period the employer has given the jobholder notice that the employer intends to defer automatic enrolment until the end of the transitional period for defined benefits and hybrid schemes ”.

(3)In subsection (4) for “at any time” substitute “ a notice is given under subsection (3) and at any later time ”.

(4)After subsection (7) insert—

“(7A)The Secretary of State may by regulations make provision about the form and content of a notice under subsection (3).”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I12Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

15Arrangements where transitional conditions cease to be satisfiedE+W+S+N.I.

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I13Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

16Power of managers to modify by resolutionE+W+S+N.I.

In section 32 of the 2008 Act (power of trustees to modify by resolution) in subsection (1) and in the heading after “trustees” insert “ or managers ”.

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I14Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

17No indemnification for civil penaltiesE+W+S+N.I.

In section 256 of the Pensions Act 2004 (no indemnification for fines or civil penalties) in subsection (1)(b)—

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I15Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

In Part 7 of the Pensions Act 2004 (cross-border activities within European Union) after section 292 insert—

“292AExemption from enrolment duty under Part 1 of Pensions Act 2008

Regulations may provide for section 2(1), 3(2), 5(2), 7(3), 9(2) or 54 of the Pensions Act 2008 (employer's obligations regarding membership of a qualifying scheme) not to apply in relation to a person's employment of—

(a)an individual in relation to whom the person is a European employer, or

(b)someone whom the person reasonably believes to be such an individual.”

Annotations:

Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Commencement Information

I16Pt. 2 (ss. 4-18) partly in force; Pt. 2 (ss. 4-18) in force at 3.11.2011 in so far as it confers power to make subordinate legislation see s. 38(1).

Part 3E+W+S+N.I.Occupational pension schemes

Prospective

Indexation and revaluationE+W+S+N.I.

19Indexation and revaluationE+W+S+N.I.

(1)Section 84 of the Pension Schemes Act 1993 (basis of revaluation of accrued benefits) is amended as follows.

(2)In subsection (5)(b) for the words from “maintains” to “index” substitute “ , in the opinion of the Secretary of State, maintains the value of the pension or other benefit by reference to the rise in the general level of prices in Great Britain ”.

(3)Omit subsection (6).

(4)Schedule 3 to the 1993 Act (which sets out methods for revaluing accrued benefits for the purposes of section 84 of the 1993 Act) is amended as follows.

(5)After paragraph 1(4) insert—

“(5)The sub-paragraphs above are subject to sub-paragraph (6).

(6)If paragraph 2A applies to the pension or other benefit, the final salary method is to apply the requirement of the rules of the scheme mentioned in paragraph 2A(1).”

(6)After paragraph 2 insert—

“2A(1)This paragraph applies to the pension or other benefit if the rules of the scheme under which it is payable contain a requirement that the accrued benefit be revalued by adding to the accrued benefit an amount of at least the relevant amount.

(2)“The accrued benefit” has the same meaning as in paragraph 1.

(3)“The relevant amount” means the amount which, ignoring paragraph 1(5) and (6), would be the additional amount specified in paragraph 1(1A), (1B), (1C) or (1D) (as the case may be) were the appropriate higher revaluation percentage and the appropriate lower revaluation percentage to be determined on the following basis.

(4)The higher revaluation percentage and the lower revaluation percentage for the revaluation period mentioned in paragraph 2(7) are to be taken to be the percentages which would have been specified in the Secretary of State's order—

(a)had the following been substituted for paragraph 2(3)(a)—

“(a)the percentage increase in the retail prices index for the reference period in relation to the revaluation period (“the inflation percentage”), and”,

(b)had, in paragraph 2(3A)(a), the words “the percentage which appears to the Secretary of State to be” been omitted,

(c)had paragraph 2(4) been omitted,

(d)had, in paragraph 2(5), the words “sub-paragraph (3)(a)” been substituted for “that sub-paragraph”,

(e)had, in paragraph (b) of the definitions of “the higher maximum rate” and “the lower maximum rate” in paragraph 2(6), the words “retail prices index” been substituted for “general level of prices”, and

(f)had the following been inserted after paragraph 2(6)—

“(6A)In this paragraph “retail prices index” means—

(a)the general index of retail prices (for all items) published by the Statistics Board (or any predecessor), or

(b)where that index is not published for a month, any substituted index or figures published by the Board (or any predecessor).””

(7)Section 51 of the Pensions Act 1995 (annual increase in rate of certain pensions) is amended as follows.

(8)For subsections (3) and (4) substitute—

“(3)Subsection (2) does not apply to the annual rate of a pension under an occupational pension scheme, or to a part of that rate, if under the rules of the scheme the rate or part is for the time being being increased at intervals of not more than twelve months by at least the relevant percentage.

(4)For the purposes of subsection (3) the relevant percentage is—

(a)the percentage increase in the consumer prices index for the reference period, being a period determined, in relation to each periodic increase, under the rules, or

(b)if lower, the default percentage for that period.

(4ZA)Subsection (2) does not apply to the annual rate of a pension under an occupational pension scheme, or to a part of that rate, if subsection (4ZB) applies to the rate or part.

(4ZB)Subject to subsection (4ZD), this subsection applies to the rate or part if, under the rules of the scheme, the rate or part is for the time being being increased, and since the relevant time has always been increased, at intervals of not more than twelve months by at least—

(a)the percentage increase in the retail prices index for the reference period, being a period determined, in relation to each periodic increase, under the rules, or

(b)if lower, the default percentage for that period.

(4ZC)In subsection (4ZB) “the relevant time” means—

(a)the beginning of 2011 or, if later, the time when the pension became a pension in payment, or

(b)if the pension was transferred to the scheme from another occupational pension scheme as a pension in payment after the beginning of 2011, the time of the transfer.

(4ZD)If the pension was transferred to the scheme as mentioned in subsection (4ZC)(b), subsection (4ZB) does not apply to the rate or part unless, immediately before the transfer, subsection (4ZB) (read with this subsection if relevant) applied to the rate or part by reference to the scheme from which the pension was transferred (or would have applied had subsection (4ZB) been in force immediately before the transfer).

(4ZE)If only part of the pension is attributable to pensionable service or, as the case may be, to payments in respect of employment carried on on or after the appointed day, in subsections (3) to (4ZD) references to the annual rate of the pension are references to so much of that rate as is attributable to that part.

(4ZF)For the purposes of subsections (4) and (4ZB) the default percentage for a period is the percentage for that period which corresponds to—

(a)in the case of a category X pension, 5% per annum, and

(b)in the case of a category Y pension, 2.5% per annum.

(4ZG)In subsections (4) and (4ZB)—

“consumer prices index” means—

(a)

the general index of consumer prices (for all items) published by the Statistics Board, or

(b)

where that index is not published for a month, any substituted index or figures published by the Board;

“retail prices index” means—

(a)

the general index of retail prices (for all items) published by the Statistics Board, or

(b)

where that index is not published for a month, any substituted index or figures published by the Board.”

“(2AA)In subsection (1) “relevant percentage increases” means percentage increases estimated by the Secretary of State from time to time for the purposes of paragraph 2(3)(a) of Schedule 3 to the Pension Schemes Act 1993 for revaluation periods of 12 months.”

(2)In sub-paragraph (3) in paragraph (a) of the definition of “appropriate percentage” for “retail prices index” substitute “ general level of prices in Great Britain ”.

(3)After sub-paragraph (3) insert—

“(3A)For the purposes of paragraph (a) of the definition of “appropriate percentage” in sub-paragraph (3), the Secretary of State may (from time to time) decide, as the Secretary of State thinks fit, the manner in which percentage increases in the general level of prices in Great Britain are to be determined.

(3B)The Secretary of State must publish any decision made under sub-paragraph (3A).”

(6)In sub-paragraph (4) in paragraph (a) of the definition of “the appropriate percentage” for “retail prices index” substitute “ general level of prices in Great Britain ”.

(7)After sub-paragraph (4) insert—

“(4A)For the purposes of paragraph (a) of the definition of “the appropriate percentage” in sub-paragraph (4), the Secretary of State may (from time to time) decide, as the Secretary of State thinks fit, the manner in which percentage increases in the general level of prices in Great Britain are to be determined.

(4B)The Secretary of State must publish any decision made under sub-paragraph (4A).”

21Indexation requirements for cash balance benefitsE+W+S+N.I.

(1)Section 51 of the Pensions Act 1995 (annual increase in rate of certain pensions) is amended as follows.

(a)it has not, on or after the appointed day, been contracted-out by virtue of satisfying section 9(2) of the Pension Schemes Act 1993, or

(b)it has, on or after the appointed day, been so contracted-out, but no person is entitled to receive, or has accrued rights to, benefits under the scheme attributable to the period on or after that day when it was so contracted-out.”

(4)After section 51ZA of the Pensions Act 1995 insert—

“51ZBMeaning of “cash balance benefit”

(1)For the purposes of section 51(7)(a), a pension provided to or in respect of a member of an occupational pension scheme is a “cash balance benefit” if conditions 1 and 2 are met.

(2)Condition 1 is that the rate of the pension is calculated by reference to a sum of money (“the available sum”) which is available under the scheme for the provision of benefits to or in respect of the member.

(3)Condition 2 is that under the scheme—

(a)there is a promise about the amount of the available sum, but

(b)there is no promise about the rate or amount of the benefits to be provided.

(4)The promise mentioned in subsection (3)(a) includes in particular a promise about the change in the value of, or the return from, payments made under the scheme by the member or by any other person in respect of the member.

(5)The promise mentioned in subsection (3)(b) includes a promise that—

(a)the amount of the available sum will be sufficient to provide benefits of a particular rate or amount;

(b)the rate or amount of a benefit will represent a particular proportion of the available sum.

(6)But a pension is not prevented from being a cash balance benefit merely because under the scheme there is a promise that—

(a)the rate or amount of a benefit payable in respect of a deceased member will be a particular proportion of the rate or amount of a benefit which was (or would have been) payable to the member;

(b)the amount of a lump sum payable to a member, or in respect of a deceased member, will represent a particular proportion of the available sum.”

24Financial assistance scheme: transfer of assetsE+W+S+N.I.

In section 286 of the Pensions Act 2004 (financial assistance scheme) in subsection (3)(c) (power to make provision for property, rights and liabilities of qualifying pension schemes to be transferred to the scheme manager) for “the scheme manager” substitute “ a prescribed person ”.

MiscellaneousE+W+S+N.I.

25Payment of surplus to employer: transitional power to amend schemeE+W+S+N.I.

(1)Section 251 of the Pensions Act 2004 (payment of surplus to employer: transitional power to amend scheme) is amended as follows.

(2)In subsection (1) after “scheme” insert—

“(a)which is one to which section 37 of the Pensions Act 1995 applies, and

(b)”.

(3)After subsection (2) insert—

“(2A)But subsection (2) does not apply in the case of any of the payments listed in paragraphs (c) to (f) of section 175 of the Finance Act 2004 (authorised employer payments other than public service scheme payments or authorised surplus payments).”

“(aa)may be exercised even if the payments to which it relates are, to any extent, payments to which subsection (2) does not apply,”;

(b)in paragraph (b) for “only be exercised once” substitute “ be exercised, after the commencement of section 25 of the Pensions Act 2011, only once (whether or not also exercised before 6 April 2011) ”;

(c)in paragraph (c) for “five years after the commencement of this section” substitute “ on 6 April 2016 ”.

(6)After subsection (6) insert—

“(6A)A resolution passed under this section after the commencement of section 25 of the Pensions Act 2011 may amend or revoke a resolution passed under this section before 6 April 2011.”

(7)The amendments made by this section do not affect the continued operation of any resolution passed under section 251(3) or (4) of the 2004 Act before 6 April 2011.

Prospective

26Contribution notices and financial support directionsE+W+S+N.I.

(1)Section 38 of the Pensions Act 2004 (contribution notices where avoidance of employer debt) is amended as follows.

(2)In subsections (5)(c)(i) and (6)(b)(ii) for “determination by the Regulator to exercise the power to issue” substitute “ giving of a warning notice in respect of ”.

(3)After subsection (13) insert—

“(14)In this section “a warning notice” means a notice given as mentioned in section 96(2)(a).”

(4)Section 43 of the Pensions Act 2004 (financial support directions) is amended as follows.

(5)In subsection (9) for “determination by the Regulator to exercise the power to issue” substitute “ giving of a warning notice in respect of ”.

(6)After subsection (11) insert—

“(12)In this section “a warning notice” means a notice given as mentioned in section 96(2)(a).”

“(6A)Subsection (6B) applies in relation to a warning notice given to a person—

(a)in respect of a contribution notice under section 38, or

(b)in respect of a financial support direction under section 43.

(6B)Regulations may provide that no determination notice in respect of the contribution notice or the financial support direction may be given after the end of the prescribed period beginning with the day on which the warning notice is given.”

27Technical amendment to Schedule 4 to the Pensions Act 2007E+W+S+N.I.

In Schedule 4 to the Pensions Act 2007 (abolition of contracting-out for defined contribution pension schemes) in paragraph 60(4) for paragraphs (b) and (c) substitute—

“(b)in the definition of “the percentage for contributing earners”—

(i)omit the words “(a) in relation to a salary related contracted-out scheme,”;

(ii)omit paragraph (b) and the preceding “and”;

(c)in the definition of “the percentage for non-contributing earners”—

(i)omit the words “(a) in relation to a salary related contracted-out scheme,”;

“(7)Until paragraph 60(4) of Schedule 4 to the Pensions Act 2007 comes into force, subsection (6) has effect as if the reference to the definition of “the percentage for contributing earners” or “the percentage for non-contributing earners” were a reference to paragraph (a) of either of those definitions.”

Part 4E+W+S+N.I.Money purchase benefits

Prospective

29Definition of money purchase benefitsE+W+S+N.I.

(1)In section 181 of the Pension Schemes Act 1993 (interpretation), in the definition of “money purchase benefits” in subsection (1), for “which are not average salary benefits” substitute “ which fall within section 181B ”.

(2)After section 181A of that Act insert—

“181BMoney purchase benefits: supplementary

(1)This section applies for the purposes of the definition of “money purchase benefits” in section 181(1).

(2)A benefit other than a pension in payment falls within this section if its rate or amount is calculated solely by reference to assets which (because of the nature of the calculation) must necessarily suffice for the purposes of its provision to or in respect of the member.

(3)A benefit which is a pension in payment falls within this section if—

(a)its provision to or in respect of the member is secured by an annuity contract or insurance policy made or taken out with an insurer, and

(b)at all times before coming into payment the pension was a benefit falling within this section by virtue of subsection (2).

(4)For the purposes of subsection (2) it is immaterial if the calculation of the rate or amount of the benefit includes deductions for administrative expenses or commission.

(5)In this section references to a pension do not include income withdrawal or dependants' income withdrawal (within the meaning of paragraphs 7 and 21 of Schedule 28 to the Finance Act 2004).”

(3)In section 99 of the Pensions Act 2008 (interpretation) in the definition of “money purchase benefits” for “which are not average salary benefits” substitute “ which fall within section 99A ”.

(4)After that section insert—

“99AMoney purchase benefits: supplementary

(1)This section applies for the purposes of the definition of “money purchase benefits” in section 99.

(2)A benefit other than a pension in payment falls within this section if its rate or amount is calculated solely by reference to assets which (because of the nature of the calculation) must necessarily suffice for the purposes of its provision to or in respect of the member.

(3)A benefit which is a pension in payment falls within this section if—

(a)its provision to or in respect of the member is secured by an annuity contract or insurance policy made or taken out with an insurer, and

(b)at all times before coming into payment the pension was a benefit falling within this section by virtue of subsection (2).

(4)For the purposes of subsection (2) it is immaterial if the calculation of the rate or amount of the benefit includes deductions for administrative expenses or commission.

(5)In this section references to a pension do not include income withdrawal or dependants' income withdrawal (within the meaning of paragraphs 7 and 21 of Schedule 28 to the Finance Act 2004).”

(5)In paragraph 1(2) of Schedule 10A to the Building Societies Act 1986 (disclosures about directors etc), in the definition of “money purchase benefits”, for “which are not average salary benefits” substitute “ which fall within paragraph 1A ”.

(6)In that Schedule, after paragraph 1 insert—

“1A(1)This paragraph applies for the purposes of the definition of “money purchase benefits” in paragraph 1(2).

(2)A benefit other than a pension in payment falls within this paragraph if its rate or amount is calculated solely by reference to assets which (because of the nature of the calculation) must necessarily suffice for the purposes of its provision to or in respect of the director.

(3)A benefit which is a pension in payment falls within this paragraph if—

(a)its provision to or in respect of the director is secured by an annuity contract or insurance policy made or taken out with an insurer, and

(b)at all times before coming into payment the pension was a benefit falling within this paragraph by virtue of sub-paragraph (2).

(4)For the purposes of sub-paragraph (2) it is immaterial if the calculation of the rate or amount of the benefit includes deductions for administrative expenses or commission.

(5)In this paragraph references to a pension do not include income withdrawal or dependants' income withdrawal (within the meaning of paragraphs 7 and 21 of Schedule 28 to the Finance Act 2004).”

(7)The amendments made by subsections (1) and (2) are to be regarded as having come into force on 1 January 1997.

(8)The amendments made by subsections (3) and (4) are to be regarded as having come into force at the same time as section 99 of the Pensions Act 2008.

30TransitionalE+W+S+N.I.

(1)The Secretary of State may by regulations make transitional provision in relation to the coming into force of the amendments in section 29.

(2)That provision includes in particular—

(a)provision disapplying the amendments in section 29 in relation to an occupational or personal pension scheme which is wound up before the coming into force of that section;

(b)provision disapplying the amendments in section 29 to any extent, or as regards any period, in respect of an occupational or personal pension scheme in relation to which those amendments would otherwise have applied on the coming into force of that section;

(c)provision modifying the application of an enactment in respect of an occupational or personal pension scheme in relation to which the amendments in section 29 apply on the coming into force of that section;

(d)provision requiring trustees or managers of an occupational pension scheme in relation to which the amendments in section 29 apply on the coming into force of that section to obtain an actuarial valuation of a description specified in the regulations.

(3)In subsection (2) “occupational pension scheme” and “personal pension scheme” have the meanings given by section 1 of the Pension Schemes Act 1993.

31Consequential and supplementaryE+W+S+N.I.

(1)The Secretary of State may by regulations make consequential or supplementary provision in relation to the amendments made by section 29.

32Power to make further provisionE+W+S+N.I.

(1)The Secretary of State may by regulations amend for any purpose the definition of “money purchase benefit” in the Pension Schemes Act 1993, the Pensions Act 2008 or Schedule 10A to the Building Societies Act 1986.

(2)Regulations under subsection (1) may in particular amend the provisions inserted by section 29 above.

(3)Regulations under this section may include transitional, consequential or supplementary provision.

33RegulationsE+W+S+N.I.

(1)Regulations under this Part may—

(a)make different provision for different cases (including different provision for pension schemes of different descriptions);

(b)provide for a person to exercise a discretion in dealing with any matter;

(c)amend Acts (as well as other enactments);

(d)have retrospective effect.

(2)Regulations under this Part must be made by statutory instrument.

(3)A statutory instrument containing regulations under this Part which amend an Act may not be made unless a draft of the instrument has been laid before, and approved by resolution of, each House of Parliament.

(4)A statutory instrument containing any other regulations under this Part is subject to annulment in pursuance of a resolution of either House of Parliament.

Prospective

Part 5E+W+S+N.I.Judicial pensions

34Contributions towards cost of judicial pensions etcE+W+S+N.I.

“ContributionsE+W+S+N.I.

9AContributions towards cost of judicial pension etc

(1)The appropriate Minister may, by regulations made with the concurrence of the Treasury, make provision for and in connection with requiring contributions to be made towards the cost of the liability for relevant benefits.

(2)The prescribed contributions are to be—

(a)made by the person to or in respect of whom the relevant benefits are to be, or may be, provided;

(b)made for the person's period of service in qualifying judicial office;

(c)in the form of deductions from the salary payable for that service.

(3)But no contribution is to be made by a person—

(a)for any period of service during which an election under section 13 is in force in respect of the person;

(b)for any period of service after the person has completed, in the aggregate, 20 years' service in qualifying judicial office;

(c)for any other prescribed period of service;

(d)in any prescribed circumstances.

(4)For the purposes of subsection (3)(b), it does not matter whether the person's service in qualifying judicial office was service before or after the commencement of section 34(1) of the Pensions Act 2011 (but no contribution is to be made for a person's service before that commencement).

Part 6E+W+S+N.I.Miscellaneous and general

MiscellaneousE+W+S+N.I.

35Grants by the Secretary of State to advisory bodies etcE+W+S+N.I.

(1)Section 174 of the Pension Schemes Act 1993 (grants by the Pensions Regulator to advisory bodies etc) is amended as follows.

(2)After subsection (2) insert—

“(3)The Secretary of State may make grants on such terms and conditions as the Secretary of State thinks fit to any person or body of persons providing advice or assistance, or carrying out other prescribed functions, in connection with occupational or personal pensions.”

(3)For the heading substitute “ Grants to advisory bodies etc ”.

36Service of documents and electronic workingE+W+S+N.I.

(1)After section 144 of the Pensions Act 2008 insert—

“144AService of documents and electronic working

In sections 303 to 305 of the Pensions Act 2004 (service of documents and electronic working) references to that Act are to be treated as including references to the following provisions of this Act—

Chapters 2 and 3 of Part 1;

section 60(1)(c);

Chapter 1 of Part 3.”

(2)In section 60 of that Act (requirement to keep records) in subsection (1)(c) for “, on request, to the Regulator” substitute “ to the Regulator on receiving a notification requesting them ”.

Pensions Act 1995 (c. 26)E+W+S+N.I.

6In section 126 of the Pensions Act 1995 (equalisation of and increase in pensionable age etc) in paragraph (a) for the words from “progressively” (where it appears first) to the end of the paragraph substitute “ and then to increase it ”.E+W+S+N.I.

Consumers, Estate Agents and Redress Act 2007 (c. 17)E+W+S+N.I.

7In section 6 of the Consumers, Estate Agents and Redress Act 2007 (general provision about functions of National Consumer Council) in subsection (10)(b) for “6 April 1955” substitute “ 6 December 1953 ”.E+W+S+N.I.

Pensions Act 2007 (c. 22)E+W+S+N.I.

8The Pensions Act 2007 is amended as follows.E+W+S+N.I.

9In section 13 (increase in pensionable age for men and women)—E+W+S+N.I.

“(b)in relation to the additional pension consolidation year and subsequent years, the weekly equivalent of the amount calculated in accordance with Schedule 4B to this Act.”

3In section 46 (modifications of section 45 for calculating the additional pension in certain benefits) in subsection (5)(a) (as inserted by paragraph 6(3) of Schedule 4 to the Pensions Act 2008) for “6th April 2020” substitute “ a date specified for the purposes of this subsection by order (“the specified date”) ”.E+W+S+N.I.

“(3)Paragraph 1(1) of Schedule 4B applies as if a reference to the relevant years within section 45(2)(d) were a reference to the relevant years falling within the period beginning with the flat rate introduction year and ending immediately before the consolidation date.”

Social Security Administration Act 1992 (c. 5)E+W+S+N.I.

8(1)Section 148AB of the Social Security Administration Act 1992 (revaluation of consolidated amount) (as inserted by paragraph 14 of Schedule 4 to the Pensions Act 2008) is amended as follows.E+W+S+N.I.

“(9)In this section “the additional pension consolidation year” has the meaning given by section 122 of the Contributions and Benefits Act (interpretation of Parts 1 to 6 etc).”

Pension Schemes Act 1993 (c. 48)E+W+S+N.I.

9The Pension Schemes Act 1993 is amended as follows.E+W+S+N.I.

10In section 46 (effect of entitlement to guaranteed minimum pensions on payment of social security benefits) in subsection (1A) (as inserted by section 103(2) of the Pensions Act 2008) for “in tax year after 5th April 2020” substitute “ on or after the date specified for the purposes of section 45(2) of that Act ”.E+W+S+N.I.

11In section 46A (retirement in tax year after 5th April 2020) (as inserted by section 103(3) of the Pensions Act 2008)—E+W+S+N.I.

(a)in subsection (1)(c) for “in tax year after 5th April 2020” substitute “ on or after the date specified for the purposes of section 45(2) of that Act ”;

(b)in the heading for “in tax year after 5th April 2020” substitute “ on or after the specified date ”.

Pensions Act 2008 (c. 30)E+W+S+N.I.

12The Pensions Act 2008 is amended as follows.E+W+S+N.I.

13In section 102 (consolidation of additional pension) in subsection (7) for “6th April 2020” substitute “ the date specified for the purposes of section 45(2) of the 1992 Act ”.E+W+S+N.I.

Prospective

Section 22

SCHEDULE 4E+W+S+N.I.Pension Protection Fund

Requirements to obtain actuarial valuationsE+W+S+N.I.

(a)for the words from “an actuarial” to the first “scheme” substitute “ a determination made, or actuarial valuation obtained, in respect of the scheme by the Board of the Pension Protection Fund under section 143(2) ”, and

(b)for “that section” substitute “ section 143 ”.

3(1)Section 141 (effect of review of ill-health pension) is amended as follows.E+W+S+N.I.

“143ADeterminations under section 143

(1)Where the Board makes a determination under section 143(2)(a) it must give a copy of the determination to—

(a)the Regulator,

(b)the trustees or managers of the scheme, and

(c)any insolvency practitioner in relation to the employer or, if there is no such insolvency practitioner, the employer.

(2)For the purposes of this Chapter a determination under section 143(2)(a) is not binding until—

(a)the period within which the determination may be reviewed by virtue of Chapter 6 has expired, and

(b)if the determination is so reviewed—

(i)the review and any reconsideration,

(ii)any reference to the PPF Ombudsman in respect of the determination, and

(iii)any appeal against the PPF Ombudsman's determination or directions,

has been finally disposed of.

(3)For the purposes of determining whether or not the condition in section 127(2)(a) or, as the case may be, section 128(2)(a) (condition that scheme assets are less than protected liabilities) is satisfied in relation to a scheme, a binding determination under section 143(2)(a) is conclusive.

This subsection is subject to section 172(3) and (4) (treatment of fraud compensation payments).

(4)Where a determination under section 143(2)(a) becomes binding under this section the Board must as soon as reasonably practicable give a notice to that effect together with a copy of the binding determination to—

(a)the Regulator,

(b)the trustees or managers of the scheme, and

(c)any insolvency practitioner in relation to the employer or, if there is no such insolvency practitioner, the employer.

(5)A notice under subsection (4) must be in the prescribed form and contain the prescribed information.”

7(1)Section 144 (approval of valuation) is amended as follows.E+W+S+N.I.

9(1)Section 151 (application for Board to assume responsibility for schemes) is amended as follows.E+W+S+N.I.

(2)In subsections (2)(b) and (3)(b) for the words from “the valuation” to “scheme” substitute “ the determination made by the Board or valuation obtained by the Board in respect of the scheme under section 143(2) ”.

(3)In subsection (6)—

(a)in paragraphs (a)(ii) and (b)(ii) after “binding” insert “ determination or ”, and

(b)for the purposes of determining whether that condition is satisfied, obtain an actuarial valuation (within the meaning of section 143) of the scheme as at the relevant time.

(3A)Before doing so, it must give the trustees or managers of the scheme a notice stating whether it will make a determination under subsection (3)(a) or obtain an actuarial valuation under subsection (3)(b).”

(3)In subsection (4) for “those purposes as it applies for the purposes mentioned in subsection (2)” substitute “ the purposes of this section as it applies for the purposes ”.

(4)In subsection (5)—

(a)for “a valuation obtained under subsection (3)” substitute “ a determination made under subsection (3)(a) and a valuation obtained under subsection (3)(b) ”,

(b)for “a valuation obtained under section 143” substitute “ a determination made under section 143(2)(a) and a valuation obtained under section 143(2)(b) ”, and

(c)after paragraph (a) insert—

“(aa)section 143A (determinations under section 143), other than subsections (1)(c) and (4)(c) (duty to give copy of determinations to employer's insolvency practitioner);”.

(5)In subsection (6)—

(a)after “sections 143” insert “ , 143A ”,

(b)omit “and” at the end of paragraph (a), and

(c)after that paragraph insert—

“(aa)subsection (3) of section 143A applies as if the reference to section 128(2)(a) included a reference to subsection (1) of this section, and”.

Requirement to obtain protected benefits quotationE+W+S+N.I.

14In section 151(4)(a) of the Pensions Act 2004 (application for Board to assume responsibility for scheme) after “form,” insert “ or evidence in the prescribed form which shows that the trustees or managers of the scheme have taken all reasonable steps to obtain a protected benefits quotation but were unable to do so, ”.E+W+S+N.I.

15(1)Section 152 of the Pensions Act 2004 (Board's duty to assume responsibility for scheme) is amended as follows.E+W+S+N.I.

(2)After subsection (1) insert—

“(1A)Subsection (2) applies where the application is accompanied by a protected benefits quotation.”

(3)After subsection (2) insert—

“(2A)Subsection (2B) applies where—

(a)the application is accompanied by evidence in the prescribed form which shows that the trustees or managers of the scheme have taken all reasonable steps to obtain a protected benefits quotation but were unable to do so, and

(b)the Board is satisfied that that is the case.

(2B)The Board must assume responsibility for the scheme in accordance with this Chapter if it is satisfied that the value of the assets of the scheme at the reconsideration time is less than the amount of the protected liabilities at that time.”

“(10A)The Board may, for the purposes of subsection (2B), obtain its own valuation of the assets of the scheme and the protected liabilities of the scheme as at the reconsideration time (within the meaning of section 151).

(10B)A valuation under subsection (10A) must be prepared in accordance with such requirements as may be prescribed.

(10C)Section 143(3) to (6) applies in relation to a determination under subsection (2B) and a valuation under subsection (10A) as it applies in relation to a determination under section 143(2)(a) and an actuarial valuation obtained under section 143(2)(b).

(10D)In the application of section 143 by virtue of subsection (10C)—

(a)references to the relevant time are to be read as references to the reconsideration time (within the meaning of section 151), and

(b)references to the pre-approval period are to be read as references to the period which begins immediately after the reconsideration time, and ends immediately before the Board first issues a determination notice under this section.”

16In the following provisions of the Pensions Act 2004 after “152(2)” insert “ or (2B) ”E+W+S+N.I.

(a)is a pension credit member of the scheme immediately before the assessment date, but

(b)has not attained normal benefit age before that date.

(2)But it applies only to the extent that the member's pension credit rights do not involve the member being credited by the scheme with notional pensionable service.

(3)Paragraphs 15, 18 and 19 apply to the pension credit member as they apply to a deferred member who has not attained normal pension age before the assessment date, subject to the following modifications.

(4)In paragraph 15—

(a)in sub-paragraphs (1) and (2) the references to normal pension age are to be read as references to normal benefit age,

(b)in sub-paragraph (4) for the words from “the aggregate of” to the end substitute “ the accrued amount ”, and

(c)for sub-paragraph (5) substitute—

“(5)In sub-paragraph (4) “the accrued amount” means an amount equal to the initial annual rate of the pension to which the deferred member would have been entitled in accordance with the admissible rules had the member attained normal benefit age on the transfer day.”

(5)In paragraph 18—

(a)for sub-paragraph (1)(b) substitute—

“(b)the pension was attributable (directly or indirectly) to a pension credit to which the deferred member became entitled under section 29(1)(b) of the Welfare Reform and Pensions Act 1999.”, and

(b)in sub-paragraph (3) the references to normal pension age are to be read as references to normal benefit age.

(6)In paragraph 19—

(a)in sub-paragraphs (1) and (2) the references to normal pension age are to be read as references to normal benefit age,

(b)in sub-paragraph (4) for the words from “the aggregate of” to the end substitute “ the accrued amount ”,

(c)for sub-paragraph (5) substitute—

“(5)In sub-paragraph (4) “the accrued amount” means an amount equal to the amount of the scheme lump sum to which the deferred member would have been entitled in accordance with the admissible rules had the member attained normal benefit age on the transfer day.”, and

(d)omit sub-paragraph (6).

(7)In this paragraph “transfer day” has the meaning given by section 29 of the Welfare Reform and Pensions Act 1999 (creation of pension debits and credits).

21A(1)This paragraph applies to a person who—

(a)is a pension credit member of the scheme immediately before the assessment date, but

(b)has not attained normal benefit age before that date.

(2)But it applies only to the extent that the member's pension credit rights involve the member being credited by the scheme with notional pensionable service.

(3)Paragraphs 15 to 19 apply to the pension credit member as they apply to a deferred member who has not attained normal pension age before the assessment date, subject to the following modifications.

(4)In paragraph 15—

(a)in sub-paragraphs (1) and (2) the references to normal pension age are to be read as references to normal benefit age, and

(b)for sub-paragraph (5) substitute—

“(5)In sub-paragraph (4) “the accrued amount” means an amount equal to the initial annual rate of the pension to which the deferred member would have been entitled in accordance with the admissible rules had the member attained normal benefit age on the transfer day.”

(5)In paragraph 16(2)(a) for the words from “day after” to “ended” substitute “ transfer day ”.

(6)In paragraph 17(2)(b) the reference to normal pension age is to be read as a reference to normal benefit age.

(7)In paragraph 18—

(a)for sub-paragraph (1)(b) substitute—

“(b)the pension was attributable (directly or indirectly) to a pension credit to which the deferred member became entitled under section 29(1)(b) of the Welfare Reform and Pensions Act 1999.”, and

(b)in sub-paragraph (3) the references to normal pension age are to be read as references to normal benefit age.

(8)In paragraph 19—

(a)in sub-paragraphs (1) and (2) the references to normal pension age are to be read as references to normal benefit age, and

(b)for sub-paragraph (5) substitute—

“(5)In sub-paragraph (4) “the accrued amount” means an amount equal to the amount of the scheme lump sum to which the deferred member would have been entitled in accordance with the admissible rules had the member attained normal benefit age on the transfer day.”

(9)In this paragraph “transfer day” has the meaning given by section 29 of the Welfare Reform and Pensions Act 1999 (creation of pension debits and credits).”

Postponement of compensationE+W+S+N.I.

22For paragraph 25A (deferral of compensation) and the heading before it substitute—E+W+S+N.I.

“Postponement of compensationE+W+S+N.I.

25A(1)Regulations may prescribe circumstances in which, and conditions subject to which—

(a)a person who becomes entitled to periodic compensation under paragraph 5, 8, 11 or 15 may elect to postpone the commencement of periodic compensation under that paragraph, and

(b)a person who becomes entitled to lump sum compensation under paragraph 7, 10, 14 or 19 may elect to postpone the payment of lump sum compensation under that paragraph.

(2)Where the commencement of periodic compensation under paragraph 5, 8, 11 or 15 ceases to be postponed, the Board must determine—

(a)the amount mentioned in sub-paragraph (3)(a) of that paragraph, as at the time the periodic compensation would have commenced if its commencement had not been postponed, and

(b)the amount in paragraph (a), increased in accordance with actuarial factors published by the Board.

(3)References in this Schedule to the amount of an actuarial increase under this paragraph, in relation to periodic compensation, are to the difference between the amounts in sub-paragraphs (2)(a) and (2)(b).

(4)Where the payment of lump sum compensation under paragraph 7, 10, 14 or 19 ceases to be postponed, the Board must determine—

(a)the relevant amount, as at the time the lump sum compensation would have been payable if its payment had not been postponed, and

(b)the amount in paragraph (a), increased in accordance with actuarial factors published by the Board.

(5)References in this Schedule to the amount of an actuarial increase under this paragraph, in relation to lump sum compensation, are to the difference between the amounts in sub-paragraphs (4)(a) and (4)(b).

(6)In sub-paragraph (4) the “relevant amount” means (as appropriate)—

(a)the amount mentioned in paragraph 7(2)(a),

(b)the aggregate of the amounts mentioned in paragraph 10(2)(a) and (b),

(a)in sub-paragraph (3) after “including” insert “ any actuarial increase under paragraph 25A and ”, and

(b)after sub-paragraph (3) insert—

“(3A)If, on the day the postponed pensioner (“P”) died, commencement of P's periodic compensation under paragraph 5 was postponed by virtue of paragraph 25A, assume for the purposes of sub-paragraph (3) that the periodic compensation commenced immediately before the date of P's death.”

(2)In paragraph 9 (periodic compensation for widow or widower of active member over pension age at assessment date)—

(a)in sub-paragraph (3) after “including” insert “ any actuarial increase under paragraph 25A and ”, and

(b)after sub-paragraph (3) insert—

“(3A)If, on the day the active member (“A”) died, commencement of A's periodic compensation under paragraph 8 was postponed by virtue of paragraph 25A, assume for the purposes of sub-paragraph (3) that the periodic compensation commenced immediately before the date of A's death.”

(3)In paragraph 13 (periodic compensation for widow or widower of active member under pension age at assessment date)—

“(assuming commencement of the periodic compensation was not postponed by virtue of paragraph 25A).”, and

(c)after sub-paragraph (3) insert—

“(3ZA)For the purposes of sub-paragraph (3)(a), if on the day the active member (“A”) died commencement of A's periodic compensation under paragraph 11 was postponed by virtue of paragraph 25A, assume that the periodic compensation commenced immediately before the date of A's death.”

(4)In paragraph 18 (periodic compensation for widow or widower of deferred member under pension age at assessment date)—

“(assuming commencement of the periodic compensation was not postponed by virtue of paragraph 25A).”, and

(c)after sub-paragraph (3) insert—

“(3ZA)For the purposes of sub-paragraph (3)(a), if on the day the deferred member (“D”) died commencement of D's periodic compensation under paragraph 15 was postponed by virtue of paragraph 25A, assume that the periodic compensation commenced immediately before the date of D's death.”

(a)the commencement of a person's periodic compensation under paragraph 11 or 15 is postponed by virtue of paragraph 25A, or

(b)the payment of a person's lump sum compensation under paragraph 14 or 19 is postponed by virtue of that paragraph.

(6)This paragraph applies as if—

(a)the person first becomes entitled to compensation under the paragraph in question immediately after the period of postponement ends, and

(b)in sub-paragraph (1)(b), for “if the person lived to the relevant age, the person would become entitled on attaining that age” there were substituted “ if the period of postponement ended, the person would become entitled ”.”

(a)in the definition of “underlying rate” for “any of the paragraphs mentioned in sub-paragraph (1)” substitute “ paragraph 3 or 22 ”, and

(b)after that definition insert—

““underlying rate” means, in the case of periodic compensation under paragraph 5, 8, 11 or 15, the aggregate of—

(a)

so much of the amount mentioned in sub-paragraph (3)(a) of the paragraph in question as is attributable to post-1997 service,

(b)

so much of the amount mentioned in sub-paragraph (3)(aa) of the paragraph in question as is attributable to post-1997 service, and

(c)

the amount within sub-paragraph (3)(b) of that paragraph immediately before the indexation date.”

(3)In sub-paragraph (5)—

(a)in paragraph (a) for the second “the” substitute “ each ”,

(b)omit the “and” at the end of that paragraph, and

(c)after paragraph (b) insert—

“(c)for the purposes of sub-paragraph (2), the definition of “underlying rate” in the case of periodic compensation under paragraph 5, 8, 11 or 15 applies as if the reference in paragraph (b) of the definition to the amount mentioned in sub-paragraph (3)(aa) of the paragraph in question was a reference to that amount reduced by the commutation percentage, and

(d)that amount (as so reduced) is attributable to post-1997 service and pre-1997 service in the same proportions as that amount would have been so attributable had no part of the periodic compensation been commuted.”

(a)to post-1997 service, in so far as it relates to so much of the amount mentioned in sub-paragraph (3)(a) of the paragraph in question as is attributable to post-1997 service, and

(b)to pre-1997 service, in so far as it relates to so much of that amount as is attributable to pre-1997 service.

(5B)Where the commencement of periodic compensation under paragraph 5, 8, 11 or 15 has been postponed by virtue of paragraph 25A, this paragraph applies as if the person first becomes entitled to periodic compensation under the paragraph in question on the day on which the periodic compensation commences.”

“(6A)A determination under sub-paragraph (2) which has effect as mentioned in sub-paragraph (6)(b)(ii) may provide that, where the payment of periodic compensation to a person is postponed by virtue of paragraph 25A, the determination applies as if the person first becomes entitled to the periodic compensation on the day on which the periodic compensation commences.”

“(6A)An order under this paragraph which has effect as mentioned in sub-paragraph (6)(b)(ii) may provide that, where the payment of compensation to a person is postponed by virtue of paragraph 25A, the order applies as if the person first becomes entitled to the compensation immediately after the period of postponement ends.”

Pension compensation sharing: postponement of compensationE+W+S+N.I.

29Schedule 5 to the Pensions Act 2008 (pension compensation payable on discharge of pension compensation credit) is amended as follows.E+W+S+N.I.

30(1)Omit paragraph 11 (deferral of compensation).E+W+S+N.I.

(2)In Part 4 after the Part heading insert—

“Postponement of compensationE+W+S+N.I.

16A(1)Regulations may prescribe circumstances in which, and conditions subject to which, a person who becomes entitled to periodic compensation under paragraph 4 or 6 may elect to postpone the commencement of periodic compensation under that paragraph.

(2)Where the commencement of periodic compensation under paragraph 4 or 6 ceases to be postponed, the Board must determine—

(a)the relevant amount, as at the time the periodic compensation would have commenced if its commencement had not been postponed, and

(b)the amount in paragraph (a), increased in accordance with actuarial factors published by the Board.

(3)References in this Schedule to the amount of an actuarial increase under this paragraph are to the difference between the amounts in sub-paragraphs (2)(a) and (2)(b).

(4)In sub-paragraph (2) the “relevant amount” means (as appropriate)—

(a)the amount mentioned in paragraph 4(3)(a), or

(b)the aggregate of the amounts mentioned in paragraph 6(3)(a) and (b).”

(a)in sub-paragraph (3) after “(including” insert “ any actuarial increase under paragraph 16A and ”, and

(b)after sub-paragraph (3) insert—

“(3A)If, on the day the transferee (“T”) died, commencement of T's periodic compensation under paragraph 4 was postponed by virtue of paragraph 16A, assume for the purposes of sub-paragraph (3) that the periodic compensation commenced immediately before the date of T's death.”

“(assuming commencement of the periodic compensation was not postponed by virtue of paragraph 16A).”, and

(c)after sub-paragraph (3) insert—

“(3A)For the purposes of sub-paragraph (3)(a), if on the day the transferee (“T”) died commencement of T's periodic compensation under paragraph 6 was postponed by virtue of paragraph 16A, assume that the periodic compensation commenced immediately before the date of T's death.”

“(5)Sub-paragraph (6) applies where the commencement of a person's periodic compensation under paragraph 6 is postponed by virtue of paragraph 16A.

(6)This paragraph applies as if—

(a)the person first becomes entitled to compensation under paragraph 6 immediately after the period of postponement ends, and

(b)in sub-paragraph (1)(b), for “if the transferee lived to the relevant age, he or she would become entitled on attaining that age” there were substituted “ if the period of postponement ended, the transferee would become entitled ”.”

“(4)Where on the granting of the application the commencement of a person's periodic compensation under paragraph 6 is postponed by virtue of paragraph 16A, this paragraph applies as if the references to the transferee attaining the relevant age were references to the period of postponement ending.”

“(7A)Where the commencement of periodic compensation has been postponed by virtue of paragraph 16A, this paragraph applies as if the transferee first becomes entitled to the periodic compensation on the day on which the periodic compensation commences.”

36In paragraph 20 (Board's power to alter rates of revaluation and indexation) after sub-paragraph (5) insert—E+W+S+N.I.

“(5A)A determination under sub-paragraph (1)(b) which has effect as mentioned in sub-paragraph (5)(b)(ii) may provide that, where the payment of periodic compensation to the transferee is postponed by virtue of paragraph 16A, the determination applies as if the transferee first becomes entitled to the periodic compensation on the day on which the periodic compensation commences.”

“(3)This sub-paragraph applies to a scheme if, in calculating the protected liabilities in relation to the scheme at the relevant time, the effect of taking into account any recent rule changes is that those liabilities are greater than they otherwise would be.

(3A)This sub-paragraph applies to a scheme if, in calculating the protected liabilities in relation to the scheme at the relevant time, the effect of taking into account any recent discretionary increases is that those liabilities are greater than they otherwise would be.”, and

“8AContributions towards cost of pension etc

(1)The Lord Chancellor may, by regulations made with the consent of the Treasury, make provision for and in connection with requiring contributions to be made towards the cost of the liability for relevant benefits.

(2)The prescribed contributions are to be—

(a)made by the person to or in respect of whom the relevant benefits are to be, or may be, provided;

(b)made for the person's period of relevant service;

(c)in the form of deductions from the salary payable for that service.

(3)But no contribution is to be made by a person—

(a)for any period of service during which an election under section 2A is in force in respect of the person;

(b)for any period of service after the person has completed, in the aggregate, 20 years' relevant service;

(c)for any other prescribed period of service;

(d)in any prescribed circumstances.

(4)For the purposes of subsection (3)(b), it does not matter whether the person's relevant service was service before or after the commencement of paragraph 1 of Schedule 5 to the Pensions Act 2011 (but no contribution is to be made for a person's service before that commencement).

“33ZAContributions towards cost of certain judicial pensions etc

(1)The appropriate Minister may, by regulations made with the concurrence of the Treasury, make provision for and in connection with requiring contributions to be made towards the cost of the liability for relevant benefits.

(2)The prescribed contributions are to be—

(a)made by the person to or in respect of whom the relevant benefits are to be, or may be, provided;

(b)made for the person's period of relevant service;

(c)in the form of deductions from the salary payable for that service.

(3)But no contribution is to be made by a person—

(a)for any period of service during which an election under section 14A is in force in respect of the person;

(b)for any period of service after the person has completed, in the aggregate, 20 years' relevant service;

(c)for any other prescribed period of service;

(d)in any prescribed circumstances.

(4)For the purposes of subsection (3)(b), it does not matter whether the person's relevant service was service before or after the commencement of paragraph 2 of Schedule 5 to the Pensions Act 2011 (but no contribution is to be made for a person's service before that commencement).

(5)In this section—

“the appropriate Minister” means—

(a)

in relation to offices existing only in Scotland, the Secretary of State, or

a pension for a sheriff (but not a sheriff principal) under section 1 of the Sheriffs' Pensions (Scotland) Act 1961;

(c)

a lump sum under section 17, so far as relating to a pension within paragraph (a) or (b);

“relevant service”—

(a)

in relation to a pension under section 7 or a lump sum under section 17 so far as relating to such a pension, means service as a stipendiary magistrate in England or Wales;

(b)

in relation to a pension for service in an office in paragraph 1 of Schedule 1 (except where under paragraph 3 of that Schedule this section does not apply) or a lump sum under section 17 so far as relating to such a pension, means relevant service as defined in paragraph 2 of that Schedule in relation to the office;

(c)

in relation to a pension for a sheriff (but not a sheriff principal) under section 1 of the Sheriffs' Pensions (Scotland) Act 1961 or a lump sum under section 17 so far as relating to such a pension, means service as a sheriff (but not a sheriff principal).

(6)Regulations under this section—

(a)are to be made by statutory instrument;

(b)may make different provision for different cases or classes of case;

(c)may make provision for consequential, transitional and incidental matters.

(7)A statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of either House of Parliament.”

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